In today’s briefing:
- The Week That Was in ASEAN@Smartkarma – Cisarua Mountain Dairy, Sumber Alfaria Trijaya, and DBS Bank
- Energy Watch: Time to Buy Oil Again?
- USD CPI Watch: The tricky path to 2% despite a soft report
- EUROPOLITICS WATCH: Opposition Victory in Poland Opens Door for Ukraine in the EU?
- Energy Cable #46: Scholz to the rescue!
- Singapore Economics: Cost Pressures Warrant a Review of the Old Playbook
- China Economics: Troubles Not Easily Solved by Beijing’s Support Measures
- [TW2] The Week That Was in Markets in 11 Charts (W/E 11th Nov 2023)
The Week That Was in ASEAN@Smartkarma – Cisarua Mountain Dairy, Sumber Alfaria Trijaya, and DBS Bank
- The past week saw insights on Cisarua Mountain Dairy (CMRY IJ), Sumber Alfaria Trijaya (AMRT IJ), Ace Hardware Indonesia (ACES IJ), Boustead Holdings (BOUS MK), and Multi Bintang Indonesia.
- There was also a macro insight on Thailand as the new government settles in and equity bottom-up insights on OCBC (OCBC SP) and DBS (DBS SP) from Daniel Tabbush.
- The Week That Was in ASEAN@Smartkarma is filled with an eclectic mix of differentiated, substantive, and actionable insights, macro and equity bottom-up, from across Southeast Asia.
Energy Watch: Time to Buy Oil Again?
- Conclusions up front: – We agree with OPEC that the demand side seems to be doing decent; paper markets are net short oil again.
- Our model is approaching the buy zone despite the recent weakness seen in Oil.
- The big risk to our model is a supply increase from an exhausted Saudi Arabian one-man-army.
USD CPI Watch: The tricky path to 2% despite a soft report
- Another CPI report, another preparation piece, where we as always share our thoughts on the coming report, what to expect next, and how far the Fed is from their all-important mandate of 2% inflation.
- Main conclusions/notes upfront: 1) The path to 2% is tricky or almost impossible for the next 6 months.
- CPI needs to average 0% MoM, which does not seem feasible.
EUROPOLITICS WATCH: Opposition Victory in Poland Opens Door for Ukraine in the EU?
- On Wednesday, the European Commission made a formal recommendation to start EU membership negotiations with Ukraine and Moldova.
- Ukraine is thereby catching up to countries such as Montenegro, Serbia, and North Macedonia whose accession processes have been underway since the 00s.
- Accepting Ukraine with a population of 43,79 million into the EU will be the end to the Union as we know it.
Energy Cable #46: Scholz to the rescue!
- After moaning like it’s the beginning of the 00’s German industry has once again been lent a helping hand from the government and this could have a huge potential impact on global energy markets.
- So let’s see what is up and down on the surface of the proposal.
- First in order to help the very energy-intensive German industry the government has decided to decrease the taxes on electricity by a whopping 190% from almost 2 cents to 0.05 cents running into 2025.
Singapore Economics: Cost Pressures Warrant a Review of the Old Playbook
- The fall in real wages despite apparent tightness in the labour market may be a symptom of the economy’s reliance on low-cost foreign labour to supplement its workforce.
- Survey evidence points to renewed cost pressures for businesses seeking to retain and expand their workforce, while cost-of-living challenges continue to plague consumers.
- These phenomena are the latest in a long-running trend of Singapore being increasingly costly for businesses and individuals. The policy playbook needs to be relooked at.
China Economics: Troubles Not Easily Solved by Beijing’s Support Measures
- Beyond the cyclical downsides for trade, Chinese goods are also facing an increasingly hostile environment due to trade restrictions imposed by skeptical recipient markets.
- Anaemic price growth suggests that demand has yet to mount a sustained recovery. Belt-tightening by consumers continues despite seasonal sales and aggressive discounting.
- Beijing has expanded support for the property sector, but long-run inefficiencies may be deepened. Watch for the next party Plenum for further hints on Beijing’s policy agenda.
[TW2] The Week That Was in Markets in 11 Charts (W/E 11th Nov 2023)
- US equities were on a tear last week. Asian equities were buoyant but less muted.
- Commodity majors were on a retreat. Gold, Silver, Oil, and Copper retreated on geopolitical conflicts that appears to be contained.
- SLOOS reported tighter standards and weaker demand for commercial and industrial loans to firms of all sizes over the third quarter.
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